Why You Need A Project Manager When You Lease Space
June 24, 2022
One of the many things that separates RubiCrown from our competitors is our commitment to providing Project Management Services with Tenant Representation/Brokerage. At our competitors’ shops, Project Management (PM), if offered, is sold through a separate silo and is considered an add-on service. Many times, your broker does not want to risk “someone else interfering with their deal,” so they will not even offer it to you as an add on. I recently heard one of my competitors say, “If a project is delayed or goes over budget, we don’t want that to be associated with our brokerage business.” They leave you, the occupier with zero experience, to manage dozens of processes and people and financial risks on your own.
One of the primary jobs of a real estate partner is to mitigate risks. If your trusted teammates leave the field when the planning, bidding and construction process begin; they are leaving you totally exposed to a financial and project crisis. Worse, if you are left with the Landlord’s trusted team to manage all things construction, your interests are not being guarded at all. Your landlord, after all, doesn’t care how much you spend, just that you start paying rent on time. This is something we see on small and large leases frequently—companies leaving the PM to their landlord and paying 6-10% of total construction costs for the pleasure of zero representation. If you have your own PM, your broker should negotiate these fees to zero.
The best practice is to include your PM consultant during the site selection process. A great PM will be able to look at the space from a build-out perspective, get early quotes from architects, engineers and general contractors before those team members are hired to help you mitigate costs. You may identify the perfect location, but the space has inefficiencies that drive costs through the roof. If you don’t tour the space with a full team of experts, you won’t know this.
Project Managers should work in-step with your broker and manage everything from getting test-fits for each location to coordinating and evaluating bids from architects, engineers, general contractors, furniture vendors, IT experts and more. They should provide detailed preliminary budgets and constantly update the actual budget based on the progression of the project.
The other critical role your PM plays is managing the clock. The longer construction drags out, the more costs and risks you are exposed to in the process. An expert PM knows what pieces of the project to do in what order to keep the project on-time and budget. This has become critically important with changes and disruptions in supply chain. If steel takes ten months for delivery, or roofing material is out of stock until x date, your PM will know how to manage this up-front, so your broker can negotiate it into your build-out time.
Finally, a good PM will control the final details from punch-list items to your physical move date, making a seamless transition for your employees. The PM should be on your team until they hand over the keys and get everyone in their proper workspaces.
At RubiCrown, our Project Management leadership has over 30 years of experience building everything from office interiors to managing complex industrial installations to overseeing ground-up construction of buildings and stadiums. And it is our commitment to provide this service to you as part of our tenant representation/brokerage process.